Backgrounder

When nutrition is crowding out education budget

Budget allocations for the free nutritious meal (MBG) program now dominate the education budget. A school feeding program that does not fundamentally serve a core educational purpose has instead become a primary focus within the government's education spending framework. This shift raises significant questions about fiscal priorities and the long-term health of the nation's pedagogical infrastructure.

Testing Indonesia’s Mideast evacuation contingency plan

Barely passing: Indonesia’s fiscal test after Fitch’s warning

Fitch Ratings recently revised Indonesia's sovereign outlook from stable to negative, although it maintained the country's BBB investment-grade rating. Fitch highlighted global geopolitical tensions and President Prabowo Subianto's free nutritious meal program as potential fiscal risks. While the government insists the massive free meals budget will remain and promises to maintain fiscal discipline, questions arise over whether fiscal policy is being designed primarily for economic stability and public welfare, or whether it is driven by political considerations.

Edition

March 6, 2026

Prabowo offers to mediate in US-Israeli war on Iran, but are there any takers?

Indonesia's official response to the attack on Iran by Israel and the United States is unusual to say the least. The Foreign Ministry in a statement said Indonesia deeply regretted the breakdown of the negotiations between the US and Iran, offered to mediate to break the impasse between the two countries, and added that President Prabowo Subianto had "stated his readiness to launch diplomatic visits straight to the heart of the conflict, if necessary".

Chasing the godfather: Oil corruption iceberg far from melted

US trade deal could compel Indonesia to pick sides

The Indonesia–United States Agreement on Reciprocal Trade (ART) reaches far beyond conventional tariff negotiations. While public debate has focused on potential export gains, the deal also includes provisions on investment, subsidy transparency and alignment with US regulatory standards that, over time, could narrow Indonesia's room for maneuver in shaping its own industrial policy and development strategy.

Edition

February 27, 2026

Desperately seeking funds for Red and White cooperatives

The Red and White Cooperative (KDMP) initiative is rapidly transforming from a flagship economic program into a mandate that must succeed at any cost. In its wake, the program is now cannibalizing the Village Fund, the very backbone of rural development and a decade-long symbol of local empowerment.

Prabowo changes Indonesia’s narrative on Palestine

Indonesia’s trade gamble amid Trump’s policy mood swings

Indonesia's much-celebrated breakthrough in lowering United States tariffs is already losing its shine. Just one day after the Agreement on Reciprocal Trade (ART) was sealed, securing a headline tariff cut to 19 percent, the US Supreme Court ruled that President Donald Trump's earlier tariff regime was unlawful. The question now is not how deep the cut appears on paper, but whether Indonesia has genuinely strengthened its bargaining position or is merely navigating an increasingly unpredictable trade landscape.

Edition

February 20, 2026

Business gives big thumbs down on Prabowo’s anti-graft drive

President Prabowo Subianto may be projecting himself globally and at home as a leader who is tough on corruption, not just in words but also in actions, with several high-profile corruption cases in his first year in office. But the business community is not impressed, and has even given the thumbs down to his overall anti-graft campaign.

Questioning the government’s health commitment to the poor

Prabowo’s corporate courtship and the politics of proximity

President Prabowo Subianto convened back-to-back meetings with key business leaders at his Hambalang residence on Feb. 9 and 10. He began with representatives of the Indonesian Employers Association (Apindo) before hosting five of the country's largest conglomerates the following day. The meetings were framed as efforts to strengthen government–business synergy and accelerate economic development. Yet they have also sparked questions about the political and economic calculus behind the outreach.